MORETOWN, Vt. — For years, dairy farmers have coped with operating in the red when the price of milk fell below the cost of production. But a prolonged period of depressed prices has caused many dairy farmers to sell their herds or fall behind on payments to lenders and creditors. Organic milk production, which had been a bright spot in the dairy industry, has also seen big price drops and now many organic farmers are facing financial challenges.
Days full of tending cows and operating the farm often leave farmers little time to deal with financial problems, especially ones beyond their control. A farmer can do everything right, yet still have no power to increase the price of milk to achieve profitability. It may feel like there is no solution and nowhere to turn for help.
The Agricultural Mediation Program is a free resource that can help dairy farmers, lenders, and creditors resolve financial problems. Below are four ways the Agricultural Mediation Program can help farmers and other members of the agricultural community during these challenging times.
Starting a Difficult Conversation
Finding the time to deal with farm finances is hard enough. It’s also human nature to avoid stressful conversations. The agricultural mediation program helps identify who needs to be involved and what information is needed to have a constructive discussion. The mediator helps each party prepare for mediation, serving as a “negotiation coach” to keep the conversation on point and increase the likelihood of reaching a mutually acceptable outcome.
A Fresh Set of Eyes
Staring at the numbers or a pile of bills all day produces few, if any, options. A mediator brings a fresh perspective to each situation. Experience working on similar cases helps the mediator suggest new approaches. As a neutral party, the mediator has “no skin in the game” and does not favor one party or a particular outcome. This neutrality enables the mediator to view the problem differently and guide the parties toward an agreement.
Untangling the Web
When the milk check is insufficient to pay off monthly loans and credit accounts, farmers must decide who and how much to pay. With a lot of moving parts (e.g., farm loans, credit cards, no- or low-interest loans, or past-due accounts), there are no easy solutions.
One thing is constant: farm loan officers and creditors want to see a feasible plan. The mediator can review financial projections with the farmer and help develop a plan to move forward. If the farmer doesn’t have current financial projections or an agricultural business planner is required, the mediator can make appropriate referrals.
The agricultural mediation program does not charge for farm loan and credit mediations. The last thing a dairy farmer facing financial problems needs to hear after “here is how we can help” is “how much it is going to cost.” If your farm is facing financial challenges, contact your state agricultural mediation program. We Grow Solutions.
Connecticut Agricultural Mediation Program
Loraine M. Della Porta
California Agricultural Mediation Program
(802) 583-1100 ext 101
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